Biodiesel Industry
The biodiesel industry is strongly related to and affected by many of the same factors as the markets for energy in general, and specifically all petroleum-based fuels used for transportation purposes. Worldwide energy consumption has been increasing rapidly. Worldwide energy demand is expected to increase by approximately 46% and worldwide oil demand by 30% from 2003 to 2020 (Source: Energy Information Administration, "International Energy Outlook 2006").

At present, worldwide demand for energy for transportation purposes is primarily met by using petroleum-based fuels. In recent years, the significance of “renewable” energy sources has increased, in part because of limited fossil fuel reserves that can be extracted economically and the related price increases, national security concerns related to dependence on imported energy as well as heightened environmental awareness, particularly with regard to the large quantities of carbon dioxide that are released when fossil fuels are burned.

The governments of numerous countries have encouraged the increased use of biofuels through various regulatory means. The European Commission, for example, has introduced biofuel consumption targets, and various countries have introduced biofuel blending requirements, quotas, and/or tax breaks that have supported growth in biofuels.

Biodiesel
Biodiesel can be used as a direct substitute for petrodiesel and can be stored, transported and distributed using the existing petrodiesel infrastructure. Tanks, pipelines, pumps and other facilities can be used for biodiesel as well as petrodiesel.

Diesel and Biodiesel Market
Biodiesel is sold either as pure biodiesel, typically directly to fleet operators (such as trucking companies), to oil companies for blending with petrodiesel, and to fuel traders who either also use it for blending or resell the product as pure biodiesel.

PETROTEC
PETROTEC believes it is one of the leading producers in Germany of biodiesel from alternative feedstocks. PETROTEC has operated as a biodiesel producer since 2000 and is therefore one of the pioneers of the German biodiesel industry, specializing primarily in processing yellow grease and other feedstocks containing a high percentage of fatty acids. PETROTEC produces biodiesel that meets the European EN 14214 biodiesel standard, mostly from yellow grease. The Company thus has costs that are lower than those of many of its competitors who produce biodiesel from more expensive feedstocks, such as rapeseed oil or other vegetable oils, as in recent years the market price for yellow grease was significantly below the price of virgin vegetable oil.

Due to PETROTEC’s multi-feedstock production process, it can process a wide range of feedstocks into biodiesel, including yellow grease, animal fats and virgin vegetable fats and oils. Another key advantage of this processing method is that PETROTEC can switch from one feedstock to another with almost no production downtime. The multi-feedstock technology, combined with the fully continuous and therefore cost-effective production process differ-entiates PETROTEC from many of its competitors, who are more limited in their choice of feedstocks and/or produce biodiesel using a non-continuous batch process.

Bio-Residual Oil - Fact Sheet